Treasuries Extend Recent Downtrend On Upbeat Data

(RTTNews) - Extending a recent downward trend, treasuries came under pressure during trading on Wednesday in reaction to some relatively upbeat economic data.

Bond prices moved notably lower in early trading and remained stuck firmly in the red throughout the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 4.4 basis points to 2.803 percent.

With the increase on the day, the ten-year yield closed higher for the fourth consecutive session, reaching its highest closing level in over two months.

The continued weakness among treasuries came following the release of the latest batch of U.S. economic data, including ADP's report on private sector employment.

ADP said private sector employment increased by 191,000 jobs in March following an upwardly revised increase of 178,000 jobs in February.

The job growth came in slightly shy of economist estimates, but Paul Ashworth, Chief U.S. Economist at Capital Economics, said the data still adds to other evidence that the economy is beginning to rebound after the weather-related weakness over the preceding few months.

"Data on activity and employment in March is still pretty limited," Ashworth said. "But what we know is that employment growth picked up, motor vehicle sales hit a seven-year high and consumer confidence rebounded to a six-year high."

He added, "This is exactly what we would have expected to see if the weather really was responsible for the run of weak data going back to December."

The Commerce Department also released a separate report showing that factory orders rebounded by more than expected in February after showing notable decreases in the two previous months.

The report said factory orders increased by 1.6 percent in February after falling by a revised 1.0 percent in January and tumbling by 2.0 percent in December. Economists had expected orders to rise by 1.2 percent.

Another batch of economic data is scheduled to be released on Thursday, including reports on weekly jobless claims, international trade, and service sector activity.

However, the impact of the reports may be somewhat subdued as traders look ahead to the release of the Labor Department's monthly jobs report on Friday.